Aug. 28 (Bloomberg) -- In January 2012, as polls showed the
French presidential race too close to call, Emmanuel Macron was
leading a double life.

By day, Macron, just turned 34 and on a high six-figure
salary at Rothschild & Cie, was working with a pool of bankers
to advise Nestle SA on what became an $11.9 billion purchase of
Pfizer Inc.’s Wyeth infant nutrition business.

By night, he worked as an unpaid adviser to the Socialist
candidate, Francois Hollande, writing the future president’s
economic platform pledging to eliminate the deficit by 2017.

Macron’s background and closeness to Hollande explain his
appointment to the cabinet yesterday as France’s economy and
industry minister in place of Arnaud Montebourg. They also show
his distance from rank-and-file members of Hollande’s Socialist
Party and their competing visions of France’s economic future.

“He knows how to network and he is totally anchored in the
real world,” Jacques Attali, an adviser to the late Socialist
President Francois Mitterrand and a political mentor to Macron,
said in a telephone interview.

Hollande turned to Macron, now 36, as the star turn of
Prime Minister Manuel Valls’s cabinet after seeing off a revolt
over the government’s economic program by ministers led by
Montebourg. Attali met with Hollande at the Elysee a couple of
hours before the president called Macron to offer him the job.

France’s new economy minister is everything his predecessor
was not: softly spoken, pro-market and in step with Hollande.
What he and Montebourg share is ambition.

Reputation ‘Exaggerated’

Where Montebourg once compared himself to the 17th century
figure Jean-Baptiste Colbert, Louis XIV’s finance minister,
Macron apologized yesterday for his “exaggerated reputation”
for free-market thinking before starting the new portfolio.

“This young man is Hollande’s surprise to erase Montebourg
and protect the economic orthodoxy,” Bruno Cautres, a political
analyst at Cevipof, a Paris-based research center, said in an
interview. “But he’s not easy to read. To be one of the
youngest economy ministers in French history shows that he is
very, very ambitious, just like his predecessor was.”

The ex-partner at Rothschild has a track record of deal
making in government. Appointed the president’s chief economic
adviser after Hollande defeated Nicolas Sarkozy in May 2012, he
was present at all the major corporate transactions involving
the French state.

GE Meetings

When Hollande was negotiating the fate of Alstom SA’s
energy business with General Electric’s CEO Jeffrey Immelt,
Macron was writing him notes and offering advice, according to a
person present who asked not to be named discussing confidential
business matters.

He sought to temper government action when Montebourg
called for the French state to take control of ArcelorMittal’s
Florange steel factory, and was key to the talks that led to the
sale of Vivendi’s SFR mobile unit business, the person said.

Macron, who ranked in the top five of his class at the
elite Ecole Nationale d’Administration, is credited with two
major reductions in payroll charges for businesses: one funded
by a sales-tax increase and the other supported by a plan to cut
public spending by 50 billion euros ($66 billion) over the
coming three years.

That put him at odds with Montebourg, who was fired for
rebelling against Hollande’s deficit-cutting plan. Many
economists welcomed his appointment, saying it confirmed the
president’s commitment to fix the French economy and restrain
the deficit.

Reform Architect

Gilles Moec, chief European economist at Deutsche Bank AG,
praised Macron as “the engineer of supply-side reforms,” while
Apolline Menut and Fabrice Montagne of Barclays Plc said that he
was “the main architect of the important reforms passed in the
first two years of Hollande’s mandate.”

Some of the 100 or so Socialist lawmakers who oppose their
own government’s economic policies have a similar perception,
leaving them to regret the appointment.

“Replacing Montebourg with Macron the liberal is a
ludicrous provocation,” Socialist deputy Laurent Baumel said in
an interview. “Montebourg embodied the French idea of economic
intervention that defines the policy of the left. Emmanuel
Macron is the symbol of Hollande’s conversion to free market
policies -- the idea that we’ll reduce unemployment by lowering
labor costs, supply-side economics.”

Trained Pianist

A prize-winning pianist married to a woman 20 years his
senior, Macron rose rapidly through France’s administration
after graduating from ENA. While working at his first job at the
Finance Ministry, at the age of 30, he joined a government
commission to free up the economy, advocating the scrapping of a
French Socialist icon, the 35-hour work week law.

Such views are already stirring up controversy. Le Point
magazine published an interview today in which Macron critized
the law, saying France needs to get out of the “trap” of
excessive workers’ rights that make it harder for people to
escape unemployment.

“It’s difficult to explain and to defend, especially when
you’re on the left,” he said in the interview, which was given
before he was named minister. Within hours of the interview’s
release, the prime minister said today that the government won’t
be adopting Macron’s views on the subject.

Jacques Attali led the economic commission that set Macron
apart. Recognizing Macron’s talents, Attali introduced him to
Hollande and to Nestle CEO Peter Brabeck.

Long Haul

It didn’t prevent Macron from failing at his first attempt
to gain a local mandate in his native Somme region of northern
France.

“The road is long,” said Attali. “He wants to get
elected. One day he’ll be presidential candidate.”

As presidential adviser, Macron had several mobile phones
to keep in touch with his contacts. It was his address book that
got him into banking, and it kept him informed in his top floor
office at the Elysee.

“I have a vision of my country and I cannot sit and watch
things pass by,” Macron said in March 2012, when still working
on Hollande’s campaign. “I want to be part of the change.”